Powering development
Mission critical and strategic sectors require uninterrupted, high-reliability power due to their impact on economic stability, national security and essential services.
Power is a critical enabler for mission critical and strategic sectors, such as data centres, semiconductor manufacturing, battery and EV production, and bio-pharma manufacturing. In 2024, data centres consumed an estimated 415 TWh of electricity—around 1.5% of global electricity demand.¹ By 2030, Goldman Sachs expects AI adoption to push that demand up by 160%. The semiconductor industry consumed 149 TWh of electricity in 2021, and this is projected to increase by nearly 60% to 237 TWh by 2030.²
Data centres
Key drivers of high-power consumption
- Hyperscale cloud, colocation, AI and high-performance computer workloads
- 24/7 uptime, high redundancy needs
- Cooling, backup power and storage requirements
Semiconductor manufacturing
Key drivers of high-power consumption
- Clean room air filtration and conditioning
- High-powered tools, e.g. for lithography, etching, and deposition
- Miniaturisation/reduction of node sizes
EV battery manufacturing
Key drivers of high-power consumption
- Clean and dry room requirements
- Electrode coating and drying
- Cell formation
Pharmaceutical and life sciences
Key drivers of high-power consumption
- Cleanroom and HVAC for R&D and production
- Cold storage and precision manufacturing
- Continuous power for vaccine and drug production
Growing importance in site selection
In the current landscape, energy has become more than just a utility. It is a strategic consideration in site selection and a critical factor in enabling future development, particularly for mission critical sectors.
Historically, site selection has focused on connectivity, real estate costs and proximity to a skilled workforce and end users. Now, power availability, reliability, and sustainability have emerged as key drivers, transforming power into a strategic differentiator. In the data centre sector, power influences operational resilience and downtime prevention and long-term sustainability. An Uptime Institute survey found that 52% of major data centre outages are due to power disruptions, underscoring the need for reliable power infrastructure.⁵
The growing need for energy-intensive technologies, such as AI, high-performance computing and advanced manufacturing, presents a quandary to organisations that want to grow and innovate, while simultaneously lowering their energy usage to achieve their Environmental, Social and Governance (ESG) objectives. As a result, there is a strong emphasis on securing sustainable and low-carbon energy solutions. However, navigating this transition is complex, as each region faces distinct challenges related to energy supply, grid quality and infrastructure.
When assessing power source feasibility for site selection, key factors include the energy mix and power generation landscape of the country, grid availability, capacity and reliability, as well as proximity to substations and transmission lines to reduce infrastructure costs. Access to renewable energy - via Power Purchase Agreements (PPAs) or green tariffs - is crucial for meeting sustainability goals, along with evaluating energy costs, carbon intensity and regulatory conditions. It's also important to consider alternative backup power options, scalability of infrastructure and utility lead times, to ensure timely and efficient deployment.
Garvan Barry Regional Director, North Asia
Though fossil fuels dominate, renewables are scaling fast—particularly wind, solar and geothermal—offering new opportunities for clean power sourcing and alignment with long term sustainability goals.
Energy landscape
The region's energy landscape is evolving, with opportunities for mission critical sectors to align with sustainability goals. Fossil fuels remain entrenched in some locations, but renewables like wind, solar, and bioenergy are rising steadily, and energy production from renewables has increased significantly in all countries. Meanwhile, electricity generation is on an upward trend across the region, although the pace and direction of decarbonisation vary significantly.
Grid carbon intensity remains high across most markets, posing a challenge for data centre operators targeting low PUE and reduced Scope 2 emissions. In such environments, achieving sustainability goals will require a strategic mix of renewable PPAs, carbon offsets, or investments in on-site clean energy generation.
Over the past decade, the energy and power mix across APAC and the GCC has shifted, although the transition presents a mixed picture, as summarised below.
Australia
- Energy supply and production: Expanded its non-fossil fuel share supply from 5.0% to 10%, largely due to investments in wind and solar energy, while reducing reliance on coal by 23%.
- Electricity generation: Reduced coal reliance from 71% to 47%, while increasing wind to 11%.
India
- Energy supply and production: Despite a 50% increase in non-fossil energy supply, the share remains at 25%, highlighting the continued dominance of coal (almost 46% of its mix) due to high demand and rapid urbanisation. Its energy supply surged by more than 50% between 2010 and 2022.
- Electricity generation: Leads regional growth in electricity generation (87% over the last two decades). Coal remains the primary source (72% in 2022), but there are early signs of renewable adoption, with solar at 5.8%, and modest gains in wind and hydro.
Japan
- Energy supply and production: Domestic energy production declined by 43% due to nuclear decommissioning, leading to a drop in energy self-sufficiency from 20.2% to 15.2%, intensifying reliance on imported fossil fuels and thermal power generation. Coal reliance in electricity generation was reduced by 29%.
- Electricity generation: Coal and gas shares have increased moderately, but solar has grown to 10%. It is the only APAC country in this report where output has declined over the last 20 years, by 16% due to the post-Fukushima nuclear phase-out.
Malaysia
- Energy supply and production: Saw a 61% increase in coal use due to limited diversification, rapid urbanisation and industrial demand.
- Electricity generation: Has restructured its mix, by cutting gas usage from 57% to 34%, while coal rose to 47% and hydro to 17%.
Singapore
- Energy supply and production: Remains heavily reliant on fossil fuels with minimal renewable integration.
- Electricity generation: Relies almost exclusively on natural gas (92%).
Taiwan
- Energy supply and production: Continued reliance on fossil fuels. Increase in adoption of renewable energy.
- Electricity generation: Renewable energy sources for electricity generation have grown, but their share remains low. Over the past two decades, the share of Solar PV and Wind in total electricity generation has increased from 0% to 5%.
KSA
- Energy supply and production: Remains heavily reliant on fossil fuels with minimal renewable integration.
- Electricity generation: Shifted from oil (54% to 41%) to natural gas (58%), with minimal presence of renewables.
UAE
- Energy supply and production: Increased its non-fossil fuel share supply from 0.0% to 7.0%, showing some progression towards clean energy.
- Electricity generation: Diversified slightly by introducing non-fossil sources, such as nuclear energy (13%) and reducing the gas share from 98% to 81%.
Key considerations
Power grid infrastructure across the region presents a diverse and evolving landscape, shaped by varying levels of economic maturity, historical investment patterns, and policy direction.
Grid reliability
Grid reliability varies significantly across the region, with countries showing different levels of performance in minimising power outages. The System Average Interruption Duration Index (SAIDI) measures the total downtime per customer per year, while the System Average Interruption Frequency Index (SAIFI) tracks the frequency of interruptions. These metrics help assess how effectively power systems meet consumer needs, with lower values indicating higher reliability.
Japan leads with just 0.04 hours of downtime (SAIDI) and 0.02 interruptions (SAIFI), while Singapore and South Korea also stand out. Countries such as Taiwan, the UAE and Malaysia demonstrate moderate reliability, with less than 0.5 hours of downtime. The grid reliability for Australia is strong in metro areas as compared to remote areas.⁶
Advanced economies – grid strain and aging assets; a growing risk
- Japan: Over 60% of transmission lines are over 20 years old, impacting reliability and increasing maintenance burdens.⁷
- Australia: Relies on aging thermal power plants, with over half of them over 40 years old, causing grid instability and sharp price increases, particularly during peak summer demand.⁸
- Singapore: Significant portions of the electricity network were built between the 1980s and 2000s, necessitating design and planning upgrades to meet evolving energy needs.⁸ ⁹
- South Korea: Facing grid congestion due to rapid offshore wind capacity expansion, limiting the grid's ability to absorb clean energy, and resulting in curtailment and wasted generation potential.¹⁰
Emerging markets – high technical losses and reliability gaps; an ongoing risk
Emerging economies, such as India and much of Southeast Asia, face a dual challenge: infrastructure modernisation and transmission efficiency. Despite strong investment momentum over the last decade, technical grid losses and grid reliability remain a key concern.
In India, transmission and distribution losses of almost 15% were reported in 2021-2022, significantly higher than the global average of 7% (2022).¹¹ ¹² It faces grid reliability issues, although urban areas perform better than rural locations.⁶
Structural and geographical constraints
- Taiwan: Relies heavily on the Hsingta power plant due to its isolated grid, creating vulnerabilities owing to unidirectional power flow. Major infrastructure overhauls are underway with Taipower, to modernise and decentralise the system.
- Japan: Faces a unique challenge with its bifurcated grid—split between 50 Hz in the north and 60 Hz in the south. This frequency divide severely restricts interregional power transfer, often resulting in energy curtailment, even when surplus supply exists in one region.¹³
- Singapore: Constrained by land and limited renewable potential, so the focus is on cross-border collaboration and smart energy imports, and reducing gas dependency.
High import dependency
Japan, South Korea and Taiwan face high energy import dependency due to limited domestic resources. Japan, the world’s fifth-largest oil consumer, relied on imports for more than 97% of its energy needs in 2022. These countries import the majority of their oil from the GCC, while Australia is a key supplier of LNG for Japan.¹⁴ This structural reliance on foreign energy sources heightens exposure to global market volatility, and reinforces the need for resilient, diversified and digitally-enabled power systems.¹⁵
Addressing energy constraints
The APAC region is leaning into the shift toward renewable energy, aiming to triple renewable capacity by 2030, and is currently the only region on-track in this regard. Despite Asia being home to 83% of the world’s coal power, significant investments are being made in expanding renewable capacity, while simultaneously upgrading transmission lines.¹⁶
APAC’s renewable energy generation plans
In 2025, it is expected that APAC will account for half of the world’s electricity consumption, with demand growing faster than the global average. A significant portion of this rising demand is expected to be met through renewables, particularly large-scale, hybrid and round-the-clock clean energy projects.¹⁷
Country-specific measures are outlined below:
- India: Targeting 500 GW of renewables by 2030, with major upgrades in transmission, storage, and cross-border links planned/underway.¹² Total installed renewable energy capacity has already reached 220.10 GW, marking a threefold increase over the past decade.
- Australia: Has set ambitious goals, aiming to double its renewable generation capacity by 2030.
- South Korea and Japan: Making major investments in offshore wind and hydrogen as part of its decarbonisation strategy.
- KSA and UAE: Rapidly expanding renewable generation capacity.
Investment in grid infrastructure and renewables integration
Over the past decade, both emerging and advanced economies in-region have significantly increased investments in grid modernisation, in order to meet evolving energy demands and decarbonisation targets, as well as the factors mentioned above. In APAC, power grid infrastructure investment has declined from approximately US$71bn to US$61bn between 2016 and 2024. Investment momentum in APAC has been uneven due to continued reliance on public funding, challenges in attracting private sector investments, and complex regulatory frameworks. However, many countries are now accelerating their grid upgrade plans to achieve sustainability goals. Below, we summarise some of these countries:
- India: Leading in transmission expansion with significant investments in HVDC infrastructure and smart meters under a US$38bn distribution reform scheme. Programmes like the Green Energy Corridor have fast-tracked green power projects.¹
- Japan: Announced US$155bn in 2022 for smart grids and interregional connectivity, preparing for offshore wind integration. It plans to increase offshore wind capacity from 253 MW in 2024 to 30-45 GW by 2040. As of December 2024, based on three rounds of auctions for the offshore wind capacity in Japan, approx. 4.5 GW of wind power capacity will come online by 2030.¹⁸
- Australia: The 2024 Integrated System Plan aims for net-zero emissions by 2050 through a sixfold increase in renewables, 10,000km of new transmission, expanded storage, and a resilient, low-cost energy system.¹⁹
- Singapore: Focusing on regional power imports from ASEAN countries and digital grid solutions, targeting 8.1 GW of clean energy imports by 2035.²⁰
- KSA and UAE: Advancing automation and smart grid technologies. The UAE plans to invest US$1.9bn to integrate AI and IoT in grids over the next decade. The KSA aims to have automated 40% of its electricity distribution network by the end 2025.²¹ ²²
Corporate Power Purchase Agreements (CPPAs)
These are long-term agreements between corporate buyers and energy producers for direct purchase of electricity. This energy is predominantly sourced from renewables such as wind, solar or hydro, aligning with sustainability goals and supporting cleaner energy transitions.
The manufacturing sector leads CPPA adoption, with data centres now emerging as significant buyers. Geothermal and hybrid renewable projects are gaining traction, although solar and wind remain dominant. According to the Rhodium Group, geothermal energy alone could economically meet up to 64% of the projected growth in data centre electricity demand by the early 2030s.²³
APAC recorded 9.7GW of clean PPAs in 2023, a 26% increase from 2022. Australia and India lead in PPA volumes, with Northeast Asia gaining momentum. India’s growth is driven by a mature PPA ecosystem, supported by expanding renewable capacity and enabling state-level policies. Among Northeast Asian markets, Japan has shown the most progress, with improvements in both renewable supply and procurement flexibility.²⁴
Key considerations for CPPAs
For mission critical sectors, selecting the right CPPA is pivotal in balancing sustainability goals with operational efficiency. Factors like energy price volatility, renewable generation sources and grid infrastructure constraints must be thoroughly analysed. Long-term contract durations, often spanning 5–20 years, should align with both sustainability strategies and energy procurement plans.
Emerging alternative energy solutions
Mission critical sectors are exploring innovative power alternatives such as Battery Energy Storage Systems (BESS), Small Modular Fuel Reactors (SMRs), and Hydrogen-Powered solutions. APAC is in the early stages compared to Europe and Americas, but studies are underway to evaluate the feasibility of these technologies.
Sources
- IEA- Energy and AI Report, Published April 2025, Licence CC BY 4.0
- Semiconductor industry electricity consumption to more than double by 2030: study, Greenpeace East Asia, April 2023; AZo Nano: Editorial Feature :Resource 3 Consumption in the Semiconductor Industry, December 2023
- Bringing energy efficiency to the fab, McKinsey & Company
- Energy technology in battery cell production: Efficiency, innovation, sustainability, Fraunhofer Research Institution for Battery Cell Production FFB, May 16, 2024
- Uptime: Frequency and severity of data center outages on the decline, Data Centre Dynamics Ltd (DCD), April 05, 2024
- World bank
- IEA - Electricity Grids and Secure Energy Transitions, Revised version, November 2023, Licence CC BY 4.0
- Climate Council - Lights Out: Ageing Coal and Summer Blackouts, January 22, 2025
- S’pore plans to upgrade electricity grid amid rising energy demand, increasing use of renewables, Straits Times, Updated November 22, 2024
- The Promise and Challenges of Expanding Renewable Energy in South Korea, Clarksons, December 18, 2023
- Aggregate Technical and Commercial Losses reduced from 21.50% to 20.93% Rs 112 crore outlay for R &D schemes in power sector, Ministry of Power, India, Posted On: February 03, 2022
- Worldbank
- IEA- Japan Electricity Security Policy, 18 August 2022,CC BY 4.0
- U.S. Energy Information Administration - Japan, Last Updated: July 07, 2023
- IEA- Building the Future Transmission Grid, Published February 2025
- Global Electricity Review 2024, Ember, May 2024
- Asia-Pacific Power and Renewable Projects Outlook 2025, Fitch Ratings, Inc., December 06, 2024
- Regional Economic Analysis of Bottom-fixed Offshore Wind Power, Renewable Energy Institute, Japan, December 2024
- 2024 Integrated System Plan For the National Electricity Market - A roadmap for the energy transition, Australian Energy Market Operator Limited, June 26, 2024
- Regional grids key to Singapore’s energy future, Ember, April 30, 2024
- DEWA unveils $1.9B smart grid to upgrade Dubai’s utility infrastructure, MEP Middle East, December 26, 2024
- Saudi Smart Grid Automation Hits 32%, Growing Fast, Saudi Arabia Energy by Eurogroup Consulting, December 29, 2024
- The Potential for Geothermal Energy to Meet Growing Data Center Electricity Demand, Rhodium Group, LLC, March 11, 2025
- 24/7 Carbon Free Energy Procurement in APAC: Pathways for Companies and Countries, Bloomberg NEF (BNEF), November 26, 2024
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